CAIRO, 28 May 2005 — The board of directors of the Misr International American Bank (MIAB) announced that their bank has been acquired by the Arab African International Bank (AAIB).
According to its statement, the bank approved the sale in order to increase its capital and meet the minimum capital requirement of the new banking law passed in 2003, which raised the minimum capital requirement from LE100 million to LE500 million.
Officials at the AAIB said they offered LE293 million for the bank’s stake, 20 percent higher than the bank’s previous offer.
“Our negotiations that began late last year hinged on LE200 million, but we decided to increase the offer because we were interested in the deal, which will be finalized by the end of this week,” said an official at AAIB who asked not to be identified.
Misr Insurance Company holds about 50.1 percent in MIAB, while Banque du Caire owns 32.8 percent.
This is the second time that a bank has acquired the entire stake of another bank in a single transaction in Egypt, according to AAIB. In September 2004, Misr Exterior Bank merged with Egypt’s second largest bank, Misr Bank, also in order to meet the new banking law requirement.
In a related development, Misr International Bank (MIBank) said that four foreign banks are bidding for its shares, but it did not give the size of the stake. In October of last year, Banque Misr said it would sell its 25 percent share in MIBank.
According to MIBank’s statement, the four potential bidders that have been shortlisted are the French banks Sociète Generale and BNP Paribas, Britain’s Barclays PLC and Bahrain’s Ahli United Bank.
Furthermore, David Hodgkinson, chief executive of HSBC Holdings PLC, said the bank’s acquisition of an Egyptian bank is a possibility.
“Egypt is beginning to look very, very interesting,” Hodgkinson, said in an interview at a World Economic Forum meeting in Jordan last week.